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This is rich. NWA Times attacks “liberal bloggers” for quoting their own report. Last week, Arkansas Media Watch pointed out a Northwest Arkansas Times report (copy of cutout below the fold) according to which Senator Mark Pryor had made the wrong and insulting statement:

Pryor said various tax breaks have created a system in which 45 percent of Americans don’t pay taxes. “It’s hard to have a fair tax system where only about half the people are paying,” he said.

This blog pointed out that most Americans do pay taxes (payroll taxes, gas and sales taxes etc.), even those too poor to pay federal income taxes. The issue of wrong or misleading statements about tax fairness has been in the air lately. Pryor’s Senate colleague John Boozman is on record with a similar wrong statement: “51 percent of the public don’t pay any federal taxes”. A recent, well researched New York Times editorial pointed out the fallacy in these claims.

Arkansas Media Watch has not only criticized the two Senators for making inaccurate statements, but also the local media for letting them get away with inaccurate statements. Pryor’s office has now maintained that Pryor was misquoted. Arkansas Media Watch has contacted NWA Times (editors Greg Harton and Lisa Thompson and publisher Rusty Turner) twice (on August 24 and 29) and requested clarification. No response.

UPDATE, April 17, 2012: While Senator Pryor’s office in the below statement claims that Pryor is concerned about millionaires not paying their fair share in taxes (“It is maddening that hundreds of millionaires pay virtually no federal income taxes, and this should change”), Pryor recently joined Senate Republicans in voting down President Obama’s proposal for a minimum tax on income millionaires (the “Buffett rule”). What does Pryor really stand for? A fairer tax system, or tax privileges for the super rich? His actions unambiguously point to the second.

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Michael Teague from the office of Senator Pryor emailed Arkansas Media Watch a clarification regarding Pryor’s remarks about tax fairness. Full text below the fold. It is essentially the same account as recently given by John Brummett: Pryor allegedly was misquoted.

AMW has asked NWA Times editor Greg Harton and journalist Larry Henry for confirmation what Pryor actually said and they have not responded. This is not reassuring. The newspaper pretends to have a policy of correcting any factual mistakes. So far this hasn’t happened. Let’s hope that the newspaper takes the incident seriously and is more careful in its future reporting.

On the other hand, Pryor’s clarification still raises some issues. Pryor expresses concern “that 1,470 taxpayers who earned $1 million or more paid no federal income taxes in 2009″. But a statement like “It’s hard to have a fair tax system where only about half the people are paying”, assuming it is meant to only refer to the federal income tax, seems to imply that more of the working poor and the elderly should be paying income taxes. Or does Pryor think half the people are millionaires? When you care about tax fairness, why would you single out just one component of the tax system? Why discuss only “the inequities in the federal income tax system, [as opposed to] city, state or even sales or excise taxes” – not to mention federal payroll taxes?

Northwest Arkansas Times today reports on remarks made by Arkansas Senator Mark Pryor at a Rogers Rotary Club luncheon (article cutout below the fold):

Pryor said various tax breaks have created a system in which 45 percent of Americans don’t pay taxes. “It’s hard to have a fair tax system where only about half the people are paying,” he said.

This is a whopper. After Pryor’s colleague Boozman wrongly declared half Americans don’t pay federal taxes, the nominally Democratic Senator found a way to frame himself as even more politically extreme by claiming that half Americans don’t pay any taxes, which is of course completely false and an insult to a significant portion of Pryor’s voters and constituents. With political leaders like Boozman and Pryor, who either don’t have the slightest clue about how the tax system works (which consists of income taxes, payroll taxes, sales taxes, gas taxes, etc. etc.) or are deliberately lying, prospects for any economic recovery in the United States are all but non-existent and a double-dip recession, if not depression, is looming on the horizon. One has to conclude that the leaders Americans have elected to help solve their problems live in a fantasy world completely disconnected from the reality ordinary (and tax-paying) people experience day by day.

The NWA Times reporter, Larry Henry, has nothing to say to correct Pryor’s wildly inaccurate statements. Unfortunately we don’t have a mass media in this country any more that has the integrity and courage to challenge politicians on their lies, hold them accountable, and act as a corrective and a check on their power. This is maybe the really scary part of it because in a functioning democracy with a media system that does its job, Washington insiders like Boozman and Pryor would be in trouble.

Arkansas Senator John Boozman appeared yesterday on KUAF’s Ozarks At Large show discussing taxes and the budget with Talk Business producer Roby Brock (the Boozman segment starts around 7:45). At one point he declares that he would reject any tax increase on the rich even if every dollar in new taxes were “offset” by 10 dollars in spending cuts. Nothing surprising there. Boozman also claims that the tax burden on US businesses is “second only to Japan” in the world (not true but Boozman does mention the issue of tax loopholes), that “the majority” (50-60%) of those filing in the highest federal tax bracket are small business owners (false), and that US federal spending “historically” has been around 19% of GDP (Reagan spent between 21.2% and 23.5%).

By far the most brazen distortion out of the Senator’s mouth comes in response to a question about taxing billionaires, at 10:15 in the podcast:

“51 percent of the public don’t pay any federal taxes right now.”

This of course is not true. Boozman meant to say that half the public don’t pay federal income taxes. This would still be highly misleading. The federal income tax is by design a progressive tax which mostly falls on earners of mid and high incomes, based on the principle that everybody should contribute according to their means. But all working people in America pay significant amounts in federal payroll taxes (which fund Social Security and Medicare), federal gas taxes (which fund interstate highway construction and maintenance), and others including state and local sales and income taxes. Most of these taxes disproportionately burden low income workers. For example, incomes above about $106,800 are exempt from payroll taxes! As a result, as documented in an earlier post, the US tax system taken as a whole is not progressive at all: the rich pay about the same overall tax rate as the poor.

“There are 10^11 stars in the galaxy. That used to be a huge number. But it’s only a hundred billion. It’s less than the national deficit! We used to call them astronomical numbers. Now we should call them economical numbers.”

The quote can be found on numerous internet sites but none of them seem to give a precise source. Wikipedia classifies the quote as unsourced and doesn’t allow it to be attributed without authentication. Assuming it is authentic, however, it can be deduced what Feynman was actually referring to: namely, you guessed it, Reagan deficit spending. Reagan was the first and only president during Feynman’s lifetime (1918-1988) to exceed the 100 billion dollar national deficit mark, and the first and only to exceed the trillion dollar debt mark. Not that you’d know it from reading Arkansas Democrat-Gazette editorials.Continue reading →

Today’s Arkansas Democrat Gazette editorial is a lighthearted satire on Reagan deficit spending. It opens with the following quote from Saint Reagan himself:

“Governments don’t reduce deficits by raising taxes on the people; governments reduce deficits by controlling spending and stimulating new wealth.”

Excellent joke – I never thought Paul Greenberg had a sense of humor. Reagan of course never balanced a budget, on the contrary he was responsible for record deficits as high as 6% of GDP, almost tripling the national debt. Neither did he control spending – he presided over a 69% increase in federal spending, much of which went to the military. He raised taxes on the people no fewer than 10 times during his tenure, including a massive tax hike in 1982 in the middle of a recession. No question, Reagan knew what he was talking about. He’s exactly the right person to ask for advice about balancing the federal budget precisely because he never managed to balance his budget, just as in our little Arkansas media world, ADG columnist Bradley Gitz is the right person to lecture Obama on economics precisely because he declared bankruptcy a few years ago. Yes, bankrupt deficit spenders are the fiscal experts of the hour. We need to hear more of their advice!

Still no give in debt impasse
As deadline nears, 2 sides remain dug in

This followed a very similar headline just two days ago:

Neither side blinks in debt showdown

This is nonsense. There is one (1) side that is dug in, and that’s the Republicans. They have declared that they won’t vote for any raise in revenues (fn1) no matter what. As ADG reported on Tuesday:

“House Speaker John Boehner stood firm in opposition to higher taxes. (…) Said House Majority Leader Eric Cantor: “We are not going to raise taxes. That’s all. (fn2)
Obama called on Republican leaders to show flexibility, saying he has “bent over backwards” to accommodate them in deficit talks. “I’m prepared to take on significant heat from my party to get something done, and I expect the other side should be willing to do the same thing if they mean what they say”, Obama said.

Obama has already offered wide-ranging budget concessions, including Social Security and Medicare cuts. The ADG storyline of “2 sides” unwilling to compromise is simply inconsistent with the facts.